Rite Aid

Rite Aid may have found the right aid for its ills. The nation's #3 drugstore chain (behind #1 Walgreen and #2 CVS), the company runs about 3,300 drugstores in 27 states and Washington, DC. Rite Aid stores fill prescriptions (accounting for about 63% of sales) and sell health and beauty aids, convenience foods, and other items, including more than 2,700 private-label products. More than half of Rite Aid stores are freestanding. A host of troubles, capped off by the restatement of more than $1 billion in inflated profits over a two-year period, has led the company to split with the founding Grass family. It also curtailed its acquisitive ways and sold its health care provider, PCS Health Systems, to reduce debt.

Campaigns

Stop Pharmacies' Discrimination Against Women

Pharmacies in nearly 20 states can refuse to fill women’s prescriptions for contraception…

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Pharmacies in nearly 20 states can refuse to fill women’s prescriptions for contraception, including the morning-after pill. Pharmacies are not ensuring that patients get their doctor-prescribed contraceptives so NARAL Pro-Choice America is imploring major pharmacies (Wal-Mart, CVS, Rite Aid, Walgreen, and Eckerd) not to interfere with a woman's choice. Click on the link below to support this campaign.

Former Rite Aid CEO, Martin L. Grass confessed to fraudulent accounting of the company’s finances and pleaded guilty to conspiracy…

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Former Rite Aid CEO, Martin L. Grass confessed to fraudulent accounting of the company’s finances and pleaded guilty to conspiracy to defraud company shareholders and stockholders, as well as conspiracy to obstruct justice. Grass received an eight-year prison sentence and a fine of $500,000 for actions that forced Rite Aid to restate its earnings by $1.6 billion in July 2000. According to prosecutors in the case, Grass unlawfully backdated contracts and severance letters and misled the company as well as federal investigators about a $2.6 million real estate deal. Employees called to testify before the grand jury were encouraged by Grass to lie about what they knew.
A jury sentenced former CFO Franklyn M. Bergonzi to 28 months in prison, former vice president Eric S. Sorkin was sentenced to five months in jail and five months house arrest, and former vice president Philip Markovitz received a month in jail and five months house arrest.

-- Associated Press, 05/24/2004

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The New Jersey Attorney General's Office and the Division of Consumer Affairs filed a lawsuit against Rite Aid Corp., accusing the…

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The New Jersey Attorney General's Office and the Division of Consumer Affairs filed a lawsuit against Rite Aid Corp., accusing the company of selling expired products such as baby formula and food, and over-the-counter drugs. The suit includes claims that Rite Aid charged consumers more for merchandise than the actual prices listed in stores. An investigation into the company’s practices revealed that 42 of Rite Aid’s New Jersey locations sold expired goods, and 76 locations engaged in improper price scanning. According to prosecutors, Rite Aid violated the Consumer Fraud Act (CFA) and the Weights and Measures Act.

-- Associated Press, 10/26/2006

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Rite Aid was ordered to pay $850,000 to the family of Jewell Deal, who died after taking a blood pressure medication that was fill…

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Rite Aid was ordered to pay $850,000 to the family of Jewell Deal, who died after taking a blood pressure medication that was filled for double the amount prescribed by her doctor. The Andalusia, Alabama woman suffered a fatal heart attack in 1999, one month after taking the 100 mg dosage of her medication Lopressor that Rite Aid incorrectly filled. A representative of the Alabama Pharmacy Association noted the possibility that a “shortage of pharmacists” could have contributed to the fatal error.

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Low-level managers working long hours solely on salaried wages initiated numerous class-action lawsuits charging employers with using unfair tactics to avoid overtime pay. Many workers bearing titles such as “store manager” or “team leader” claim that their time is primarily spent carrying out tasks that do not qualify as management duties, meaning their jobs are misclassified so as to rule out opportunities for overtime wages. Rite Aid agreed to settle a group of lawsuits for $25 million, although the company did not admit any wrongdoing.

-- Los Angeles Times, 06/29/2001

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Florida's Attorney General filed a racketeering lawsuit against Right Aid in September 1999 for wrongly overcharging prescription …

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Florida's Attorney General filed a racketeering lawsuit against Right Aid in September 1999 for wrongly overcharging prescription drug customers. According to the suit, Rite Aid overcharged 29,000 uninsured customers; however, the company insisted that the lawsuit was without grounds.